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LOCAL TAX NEWS

PROFESSIONAL TAXIN HARYANA

Advocate Iranpreet Singh
January 20, 2025
15 min read

Professional Tax in Haryana is a state-level tax imposed on individuals engaged in professions, trades, callings, and employment. This comprehensive guide covers current rates, eligibility criteria, exemptions, and compliance requirements for 2025.

TABLE OF CONTENTS

PROFESSIONAL TAX OVERVIEW

UNDERSTANDING HARYANA PROFESSIONAL TAX

Professional Tax is a direct tax levied by the Government of Haryana on individuals engaged in any profession, trade, calling, or employment within the state. It is governed by the Haryana Tax on Professions, Trades, Callings and Employments Act.

Key Features of Haryana Professional Tax

Tax Authority:

  • Government of Haryana
  • State-level direct tax
  • Annual payment required
  • Certificate-based system

Coverage:

  • All professions and trades
  • Employment income
  • Business activities
  • Consultancy services

👨‍💼 Professionals

Doctors and lawyers
Engineers and architects
Chartered accountants
Consultants

🏢 Businesses

Traders and merchants
Contractors
Service providers
Manufacturing units

👥 Employees

Salaried employees
Government employees
Private sector workers
Contract workers
WHO PAYS PROFESSIONAL TAX

ELIGIBILITY AND LIABILITY

Professional Tax in Haryana is applicable to all individuals and entities engaged in any profession, trade, calling, or employment within the state, subject to specific income thresholds and exemptions.

📋 Liability Categories

Individual Professionals:

  • Doctors: All medical practitioners
  • Lawyers: Advocates and legal consultants
  • Engineers: All engineering disciplines
  • Chartered Accountants: CAs and tax consultants
  • Architects: Building design professionals

Business Entities:

  • Traders: Wholesale and retail businesses
  • Contractors: Construction and service contractors
  • Manufacturers: Industrial production units
  • Service Providers: IT, consulting, transport
  • Partnerships: All partnership firms

💼 Employment Categories

Government Employees

  • • State government employees
  • • Central government employees
  • • PSU employees
  • • Municipal employees

Private Employees

  • • Corporate employees
  • • Factory workers
  • • Service sector employees
  • • Contract employees

Special Categories

  • • Directors of companies
  • • Consultants and advisors
  • • Part-time employees
  • • Freelancers

🎯 Income Thresholds

Minimum Income Criteria

For Individuals:

  • • Annual income above ₹2,50,000
  • • Includes all sources of income
  • • Professional and business income
  • • Employment income

For Entities:

  • • Annual turnover above ₹5,00,000
  • • Gross receipts from business
  • • Professional service income
  • • All business activities combined

📍 Territorial Jurisdiction

Liable Persons:

  • Residents of Haryana engaged in any profession
  • Non-residents earning income in Haryana
  • Businesses operating in Haryana
  • Employees working in Haryana

Coverage Areas:

  • All districts of Haryana
  • Urban and rural areas
  • Industrial areas and SEZs
  • Commercial complexes
CURRENT RATES 2025

HARYANA PROFESSIONAL TAX RATES

💰 Tax Rate Structure

CategoryAnnual Income/TurnoverAnnual TaxMonthly Deduction
Individuals (Salaried)₹2,50,000 - ₹5,00,000₹2,500₹208
Individuals (Salaried)Above ₹5,00,000₹5,000₹417
Professionals₹2,50,000 - ₹10,00,000₹5,000-
ProfessionalsAbove ₹10,00,000₹10,000-
Traders/Businesses₹5,00,000 - ₹20,00,000₹5,000-
Traders/BusinessesAbove ₹20,00,000₹15,000-
Companies/CorporationsAny turnover₹25,000-

📊 Rate Comparison by Category

Salaried Employees

  • • Lower rates for employees
  • • Monthly deduction system
  • • Employer responsibility
  • • Two-tier rate structure

Self-Employed

  • • Higher rates for professionals
  • • Annual payment system
  • • Self-assessment basis
  • • Income-based slabs

Corporate Entities

  • • Flat rate for companies
  • • Highest tax liability
  • • Annual compliance
  • • No turnover threshold
EXEMPTIONS

WHO IS EXEMPT FROM PROFESSIONAL TAX

🚫 Complete Exemptions

Income-Based Exemptions:

  • Annual income below ₹2,50,000 (individuals)
  • Annual turnover below ₹5,00,000 (businesses)
  • Persons with no taxable income
  • Students without professional income

Category-Based Exemptions:

  • Physically disabled persons (40% or more)
  • Senior citizens above 65 years
  • Widows with limited income
  • Unemployed persons

🏛️ Institutional Exemptions

Government Entities

  • • Central government departments
  • • State government offices
  • • Municipal corporations
  • • Public sector undertakings

Educational Institutions

  • • Government schools and colleges
  • • Recognized educational institutions
  • • Research organizations
  • • Non-profit educational trusts

Charitable Organizations

  • • Registered charitable trusts
  • • Religious institutions
  • • NGOs and social organizations
  • • Hospitals (charitable)

📋 Exemption Application Process

Required Documents

For Individual Exemptions:

  • • Income certificate from competent authority
  • • Age proof (for senior citizens)
  • • Disability certificate (if applicable)
  • • Identity and address proof

For Institutional Exemptions:

  • • Registration certificate
  • • Trust deed or memorandum
  • • Audited financial statements
  • • Activity and purpose documentation
REGISTRATION PROCESS

HOW TO REGISTER FOR PROFESSIONAL TAX

📝 Registration Requirements

Mandatory Registration:

  • All professionals above income threshold
  • Businesses above turnover limit
  • Employers with eligible employees
  • Companies and corporations

Registration Timeline:

  • Within 30 days of liability arising
  • Before commencement of business
  • Annual renewal required
  • Late registration penalties apply

📄 Required Documents

Individual Professionals

  • • PAN card copy
  • • Aadhaar card copy
  • • Professional qualification certificates
  • • Address proof
  • • Income proof/ITR
  • • Passport size photographs

Business Entities

  • • Business registration certificate
  • • Partnership deed/MOA
  • • PAN card of entity
  • • GST registration certificate
  • • Bank account details
  • • Authorized signatory details

Employers

  • • Company incorporation certificate
  • • Employee list with salaries
  • • Establishment registration
  • • PF/ESI registration
  • • Office address proof
  • • Authorized representative details

🔄 Registration Process Steps

Step-by-Step Process

1
Application
Submit form with documents
2
Verification
Document verification by officials
3
Payment
Pay registration fee and tax
4
Certificate
Receive registration certificate
PAYMENT & COMPLIANCE

PAYMENT PROCESS AND COMPLIANCE

💳 Payment Methods

Online Payment:

  • Haryana government portal
  • Net banking and debit/credit cards
  • UPI and digital wallets
  • Instant receipt generation

Offline Payment:

  • Designated bank branches
  • Treasury offices
  • Cash or demand draft
  • Manual receipt processing

📅 Payment Schedule

Annual Payment Timeline

April 1
Financial Year Begins
July 31
First Installment Due
December 31
Second Installment Due
March 31
Financial Year Ends

Monthly Deduction (Employees)

Employer Responsibility:

  • • Monthly deduction from salary
  • • Deposit by 7th of next month
  • • Annual reconciliation required
  • • Employee-wise records maintenance

Employee Rights:

  • • Salary slip showing deduction
  • • Annual certificate from employer
  • • Right to verify payments
  • • Grievance redressal mechanism
PENALTIES

PENALTIES AND CONSEQUENCES

⚠️ Penalty Structure

Late Payment

  • • 25% of tax amount as penalty
  • • Interest @ 12% per annum
  • • Minimum penalty ₹500
  • • Compounding allowed

Non-Registration

  • • ₹5,000 to ₹25,000 penalty
  • • Prosecution proceedings
  • • Backdated tax liability
  • • Business closure possible

False Information

  • • Double the tax amount
  • • Criminal prosecution
  • • Imprisonment up to 6 months
  • • Registration cancellation
PRACTICAL EXAMPLES

REAL-WORLD SCENARIOS

💼 Case Studies

Example 1: Software Engineer in Gurgaon

Profile:

  • • Annual salary: ₹8,00,000
  • • Employment: Private company
  • • Location: Gurgaon, Haryana
  • • Age: 28 years

Tax Liability:

  • • Annual Professional Tax: ₹5,000
  • • Monthly deduction: ₹417
  • • Employer deducts and deposits
  • • Employee pays: ₹0 directly

Example 2: Independent Chartered Accountant

Profile:

  • • Annual professional income: ₹15,00,000
  • • Practice: Independent CA practice
  • • Location: Faridabad, Haryana
  • • Experience: 10 years

Tax Liability:

  • • Annual Professional Tax: ₹10,000
  • • Payment: Two installments
  • • July 31: ₹5,000
  • • December 31: ₹5,000

Example 3: Trading Business

Profile:

  • • Annual turnover: ₹35,00,000
  • • Business: Electronics trading
  • • Location: Panipat, Haryana
  • • Structure: Partnership firm

Tax Liability:

  • • Annual Professional Tax: ₹15,000
  • • Registration required
  • • Annual payment in two installments
  • • Each partner liable individually

GET PROFESSIONAL HELP

Professional Tax Registration
Complete assistance with professional tax registration and compliance
Exemption Applications
Help with exemption applications and documentation
Legal Disputes
Representation in professional tax disputes and appeals
Contact Advocate Iranpreet Singh
Expert Professional Tax Legal Advice in Haryana
📞+91-XXXXX-XXXXX
📧contact@iranpreetsingh.com
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